Like folks in most industries, collision repair professionals throw around acronyms and abbreviations with abandon. Among them: ROs, DRPs, R&I, CSI, VOCs, HVLP, NACE, I-CAR, ASA, and yes, ABRN, to name just a few. But two abbreviations that debuted in recent years have taken on special importance. SOPs (standard operating procedures) and KPIs (key performance indicators). When shop owners and industry experts discuss the efficient, profitable, ideal paint shop, these terms are almost guaranteed to come up.
Top-notch equipment can add to a shop's success. But what's more important are the processes that are in place. Photo courtesy of Troy Aldrich, Freeman Collision Center
SOPs have been around forever in virtually every industry, but in the collision repair industry, shop management programs have recently brought them to prominence. They’re recommended for every aspect of shop operation, including estimating and dealing with insurers. But nowhere are they more important than in the paint shop, according to the experts we consulted.
Hank Nunn, president of HW Nunn & Associates, says SOPs and processes are the keys to an ideal shop. Nunn speaks from a position of authority. He started as a technician, became a collision shop owner and a jobber store owner, and during the past two decades earned a reputation as a provider of management training to the collision repair industry.
Nunn says there should be detailed SOPs and job descriptions for everyone—production managers, painters, preppers and detailers—so every employee knows exactly what’s expected of him or her.
“Everyone must know his or her task and how to perform it precisely,” he says. That leads to more cars going through the booth.
Booth utilization, of course, is another key to achieving the ideal. “You have to minimize the time the car is in the booth,” says Nunn. “Two cars should be prepped and ready at all times to go into the booth—and that means totally ready. Masking and prepping of any kind should not be done in the booth.”
As for the paint itself, he calls today’s products “fantastic,” citing fast-drying primers, precisely-matched color coats and hyper-cure clears. One key in this area: choose the paint line and supplier that is right for your shop and don’t mix it with other lines.
When it comes to equipment, Nunn says the ideal shop needs a computerized scale and high-volume, low-pressure (HVLP) guns. (One tool he didn’t mention—a spectrophotometer, to read the color on the vehicle—is in most top shops). Beyond that, everything depends on SOPs and organization. In fact, he believes good processes will overcome inferior equipment.
“I know shops that install new booths and then they complain that they’re still only turning out three cars a day,” he says. “And I tell them, ‘Of course you are, [because] you haven’t changed your processes.’”
Measuring success
Terry Mostul, who owns three Fix Auto shops near Portland, Ore., certainly is on board with Nunn and all those who feel SOPs are important. But pressed to pinpoint the most important aspect of paint shop management, he says, simply, “KPIs.”
“Assuming that performance-driven programs are here to stay, I think that measuring and tracking KPIs are most important to the ideal shop,” says Mostul.
Among those KPIs are cycle time, repair vs. replacing parts, alternate parts use, customer satisfaction index and severity, or average cost of a repair. These measurements provide a profile of the shop and where it stands in relation to its goals, he says. It’s part of the growing reliance on information technology, which Mostul characterizes as “a very important tool in your toolbox today.”
Doug Kelly is president and COO of the Fix Auto network, and he is a major advocate of KPI measurement. Kelly believes this allows for consistent, immediate feedback regarding relationships with insurers. “It allows peer-to-peer comparisons—estimator-to-estimator, shop-to-shop, etc.—and eliminates uncertainly around, ‘How am I doing?’,” he says. “It also allows shops to have informed discussions with insurers during audits/inspections. These discussions provide insight as to how insurers value and measure shop performance.”
Team structure
Another key to ideal shop operation, according to Mostul, is the concept of team structure and pay plans. These encourage teamwork because they involve both accountability, which reduces wasted material, and incentives, which increases productivity.
“Managerial control” is the key to making such a structure successful, he says. “And that includes sharing information, even profit reports. I’ve found that sharing things such as profit reports gets employees engaged, and engaged employees are more productive.”
Bruce Gamroth, education manager for the collision repair program at Universal Technical Institute, agrees with both Nunn and Mostul. “Developing SOPs and making sure employees follow them makes fundamental sense,” he says. One result, he explains, is a reduction of comebacks, which are perhaps the primary drain on profits.
SOPs also can help to reduce a paint shop’s material costs. For instance, “Everyone is using the same type of sandpaper for a given job, so you don’t have to order six different types of paper,” says Gamroth.
Standardization should extend to equipment, he says. Painters should use HVLP guns for everything—primers, sealers, basecoats, clears. “And no bootlegging,” he says. “That means no number sevens, even if the painter is in love with his old gun.”
Finally, you need a good vacuum system, which makes for cleaner jobs and reduces time spent cleaning up after such steps as dry sanding.
Steve Lebron, of Custom Layout and Design in Tekamah, Neb., emphatically agrees with Gamroth about the vacuum system. “It improves the paint quality tremendously,” he says.
If the shop is using forced air heat, maintaining a clean environment is a challenge. “Forced air blows dirt, dust and all the junk in the air around the shop,” says Lebron, who recommends infrared heat, or floor/baseboard heating systems that radiate heat upward.
Lighting is another critical consideration. Lebron says too often shops opt for economy lighting, such as high bay lights, mercury vapor or high-pressure sodium. “These are fine in the body area, but in the paint shop you need fluorescent lights with a color rendering index of 85 percent or better,” he advises. (The CRI is a method for describing the effect of a light source on the color appearance of objects. The highest CRI attainable is 100. Typical cool white fluorescent lamps have a CRI of 62. (See “The Right Light,” ABRN June 2004, p. 50.)
And, like Nunn, Lebron emphasizes optimum booth utilization. “Managing equipment operation is essential, and the booth is the key piece of equipment. The standard spray booth is rated at about 1.2 million BTUs, and you need to monitor how that energy is used. Some shops turn on the booth as soon as they open the doors in the morning, when there’s really no need to do that until you’re ready to paint.”
Approaching perfection
If there is one shop that approaches the perfection implied by the “ideal” appellation, it’s probably Freeman Collision Center in Santa Rosa, Calif. Both Nunn and Lebron mentioned Freeman when asked for the name of a nearly perfect facility. The 43,000-sq.-ft. collision center is a model of efficiency, productivity and profitability. It turns out 200 cars and grosses about $500,000 per month.
Troy Aldrich, manager of the shop, says scheduling is the key to success. “It’s very important not to mix big jobs with little jobs,” says Aldrich. “You don’t want to schedule a 20-hour job in front of a two-hour job.”
Most “little jobs” come out of Freeman’s “on-time line.” These repairs, involving mostly fenders, bumpers and hoods, represent about 50 percent of the shop’s work, and average $1,333. Typically, Freeman cranks out each of them in an astounding 1.8 days.
Of course, when it comes to scheduling, Aldrich is sitting in the catbird’s seat. The shop has two 27-ft. spray booths, four 24-ft. prep booths and a cut-in booth. What’s more, some 100 parts carts circulate constantly, making sure all technicians have the parts they need. And every technician has a computer.
The Freeman paint shop is set up in the in-line production style recommended by Lebron. “It’s linear, like an assembly line,” Aldrich explains. There is a prep station, followed by a priming area, then a sanding and blocking area, and then the spray booth.
Another recommendation from Aldrich: “One guy should be in charge of mixing and matching colors, and that includes sprayouts.” That way, he explains, you have consistency and the painter doesn’t waste his time doing sprayouts and trying various gun techniques and settings to make the match in the booth.”
Cutting costs
Like all successful shops, Freeman strives for continuous improvement. Much of that focuses on reducing costs and thereby improving profits. Freeman’s hazardous waste disposal program makes a major contribution to the bottom line. The shop’s solvent distillation unit (SDU) cuts down the expense, liabilities and headaches associated with hazardous waste. Despite the tremendous number of repairs the shop does, its hazardous waste has been reduced to one 55-gallon drum per year, according to Aldrich. Industry experts have estimated that recycling allows a gallon of solvent to be re-used four to five times.
For further cost savings, Aldrich relies on the computerized paint mixing system recommended by Nunn. By mixing paint precisely and accurately, the system eliminates overpours, which not only throw off the color but also waste material.
Continuous improvement also involves training to keep everyone up-to-date on the latest paint systems and tools. Aldrich estimates that the shop spent $30,000 on training in the paint department alone during 2004.
But he also involves the technicians in another way. “Each month we hold a meeting on how to improve what we’re doing,” he says. “We order in a nice lunch and sit around and talk shop. They have some good ideas, and it’s a great way to get buy-in from the technicians.”
Communication underlies everything that occurs in the ideal shop. Devices like the monthly Freeman lunches are nice, but more important is a brief release meeting, which is held on a daily basis. The meeting—no more than 15 minutes long—should take place before actual work begins. Ideally, painters should walk away from the meeting with written directions as to what is expected of them that day.
While shops may be limited in terms of facilities and equipment, every shop can institute standard operating procedures, including communications, and measure performance. Those are the most important steps in achieving the ideal operation.